Dollar Inches EGP 0.1 Higher On Central Bank’s 21st FX Auction

As Egypt’s Central Bank has offered its 21^st FX auction, the U.S. dollar’s exchange rate for Wednesday rose to EGP 6.7280 (buy price) and EGP 6.7580 (sell price), representing an increase of EGP 0.1, compared to previous day’s levels of EGP 6.7180 (buy price) and EGP 6.7480 (sell price).

Belal Khalil, Deputy Chairman of the Foreign Exchange Division of the Federation of the Chamber of Commerce, said the price of the U.S. currency rose today by EGP 0.1 only as the CBE has offered on Wednesday US$ 40 million to local banks.

The Central Bank of Egypt has offered US$ 40 million to local banks on Wednesday, with a maximum of US$ 6 million to each bank, so as to address dollar shortage at the banking sector at its 21st FX auction and the fifth one since Hisham Ramez came into office.

After assuming the responsibilities of his new position, Ramez started offering US$ 75 million in a FX auction, then US$ 50 million and US$ 40 million today, bringing the amount CBE offered under his leadership to US$ 215 million.

The decisions adopted by the recently-assigned governor have contributed to curb the significant rise in the dollar’s value.

Dr. Ramez has taken a number of procedures to curb dollar’s constant rise against the national currency such as cancelling the 1% commission that had been placed on banks and forex firms, limiting the number of currency auctions to just two a week, and limiting the range of rates at which banks could sell and buy currency from one another.

Upon his instructions, the central bank has also tightened the pound’s trading band in the interbank foreign exchange market. Accordingly, Banks may now only buy or sell dollars or their equivalent to other banks in a band of 0.01 pounds above or below the weighted average bid at the central bank’s regular currency auctions, the dealer said. Previously, the limit had been 0.5 percent above or below the average bid.

The values that CBE offered in FX auctions under the leadership of Hisham Ramez are as follows: